Selling Your House Things To Consider When - Collins Community Credit Union
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Things To Consider When
FALL 2021
Selling Your House EDITION
The Home Team
Altoona | Ankeny | Cedar Falls | Cedar Rapids | Clive | Davenport
Dubuque | Marion | North Liberty | West Des Moines
thehometeam@collinscu.org | 800-475-1150
www.collinscu.org/mortgage
Table of Contents
3 4 Major Incentives To Sell This Fall
6 Expert Insights on the Current
Housing Market
8 Will Home Prices Continue To Rise?
10 Leveraging Your Equity To Make a Move
13 Remote Work Is Changing
Our Home Needs
15 If I Sell Now, Where Will I Go?
17 Should I Renovate My House
Before I Sell It?
18 Save Time and Effort by Selling
with an Agent
20 Why Pricing Your House Right Matters
21 How To Prepare Your House for
a Winning Sale
22 Reasons To Hire a
Real Estate Professional
4 Major Incentives To Sell This Fall
If you're trying to decide when to sell your house, there may not be a better time
to list than right now. The ultimate sellers' market we're in today won't last
forever. If you’re thinking of making a move, here are four reasons to put your
house up for sale sooner rather than later.
1. Your House Will Likely Sell Quickly
According to the Realtors Confidence Index released by the National Association of
Realtors (NAR), homes continue to sell quickly – on average, they're selling in just
17 days.
As a seller, that's great news for you. Average days on market is a strong indicator of
buyer demand. And if homes are selling quickly, buyers have to be more decisive and
act fast to submit their offer before other buyers swoop in.
2. Buyers Are Willing To Compete for Your House
In addition to selling quickly, homes are receiving multiple offers. That same survey
shows sellers are seeing an average of 4.5 offers, and they’re competitive ones.
Realtor.com sums up the impact this can have:
“Buyers today know bidding wars are a likely outcome and they're coming
prepared with their best offer in hand. Receiving several offers on your house
means you can select the one that makes the most sense for your situation
and financial well-being.”
3
3. When Supply Is Low, Your You can leverage that equity, plus current
House Is in the Spotlight low mortgage rates, to power your move
now. But these near-historic low rates won’t
One of the most significant challenges for last forever.
motivated buyers is the current inventory of
Experts forecast mortgage rates will start to
homes for sale. Though it’s improving, it
rise in the months ahead. In their forecast,
remains at near-record lows. The chart below
Freddie Mac says:
shows just how low today’s inventory is.
“While we forecast rates to increase
If you’re looking to take advantage of buyer
gradually later in the year, we don't
demand and get the most attention for your
expect to see a rapid increase. At the
house, selling now before more listings come
to the market might be your best option. end of the year, we forecast 30-year
rates will be around 3.4%, rising to
4. If You’re Thinking of Moving Up, 3.8% by the fourth quarter of 2022.”
Now May Be the Time When rates rise, even modestly, it’ll impact
your monthly payment and by extension your
If your current home no longer meets your
purchasing power.
needs, it may be the perfect time to make a
move. Today, homeowners are gaining a
significant amount of wealth through
growing equity.
12.5 2010
Months
11.5 2008 Buyers’
Inventory of 10.5 Market
Homes for 9.5 2007 (> 7 Months)
Sale 8.5
7.5 2006
Today’s low 6.5 Neutral Market (6-7 Months)
inventory puts us 5.5
in one of the 4.5 Sellers’
strongest sellers’ 3.5 1999 Today Market
markets ever 2.5
(< 6 Months)
1.5
NAR
Bottom Line
Don't delay. The combination of housing supply challenges, low mortgage rates, and
extremely motivated buyers gives sellers this season a unique opportunity. If you’re
thinking about making a move, let's chat about why it makes sense to list your house
sooner rather than later.
4
In the past, home sellers might have waited
weeks or months to get an offer that might not
be as high as they’d hoped. Buyers may have
lowballed, or driven a hard bargain . . .
Today . . . homes are getting snapped up fast,
sometimes within days of going on the
market. Buyers mired in bidding wars are
pushing their offers over asking price, and
often waiving inspections and other demands
to sweeten their offer.
- realtor.com
5
Expert Insights on the
Current Housing Market
Real estate experts agree that the strength of today’s housing market isn’t going
away anytime soon. Here’s what several industry leaders have to say:
“
The improvement we saw in new listings growth . . . shows sellers are entering
the market historically later in the season, which could mean we’ll see
home buying continue into the fall as buyers jump at new opportunities.
- George Ratiu, Senior Economist, realtor.com
“
Low mortgage rates likely will remain a strong pull for potential home buyers.
A rush to lock in a low rate may continue to propel the housing market. NAR
predicts the 30-year fixed-rate mortgage to rise, expecting it to average 3.2% from
October through December.
- National Association of Realtors
“
The good news for homeowners and potential sellers is that despite slowing,
home prices continue to grow. . . . We expect prices to ease as we head into fall,
as they have historically, which means we may not see new all-time highs, but are
likely to see the highest prices ever for the fall and winter season.
- Danielle Hale, Chief Economist, realtor.com
“
Existing-home sales have moderated in recent months, and some may believe that
this is due to a demand pullback. Yet, examining market dynamics with our
Potential Home Sales Model indicates the moderation in home sales is the
result of a lack of supply more so than a falling demand.
- Mark Fleming, Chief Economist, First American
6
KEY TAKEAWAY
Sellers who want to close a deal on the best
possible terms shouldn’t wait to put their
houses on the market. Let’s connect today so
you can get in on the action and move into your
dream home this year.
7
Will Home Prices Continue To Rise?
According to the latest CoreLogic Home Price Insights Report, nationwide,
home values increased by an impressive 17.2% over the last 12
months. The dramatic rise happened when the inventory of houses for sale
reached historic lows at the same time buyer demand skyrocketed as a result of
near record-low mortgage rates.
Where Will Home Values Go from Here?
Home price appreciation will continue to be determined by an imbalance of supply and
demand. If supply remains low and demand high, prices will continue to increase,
making it a great time to sell your house. Frank Martell, President and CEO of
CoreLogic, explains:
“Home prices have been rising in the mid-single digits for some years now.
The recent surge to double-digit price jumps reflect the convergence
of exceptional demand and persistent low supply . . .”
Housing Supply
Home prices are rising, but they should moderate as more housing inventory comes to
market. George Ratiu, Senior Economist at realtor.com, says there are signs we may
see the current inventory challenges lessen, slowing the fast-paced home price
appreciation and creating more choices for buyers:
“. . . there are still fewer homes for sale than last year when we were focused on
how limited supply was holding back the housing market. On the other hand, the
gap continues to shrink. . . . This means that low inventory of homes for sale is
still a problem, but we’re on pace to see inventories grow before the end
of the year.”
8
2021 Home Price Forecasts
Top real estate analysts’ expectations for annual price appreciation
14.8% 14.1% Average of All Forecasts: 12.46%
12.1%
11%
10.3%
Fannie Mae NAR Freddie Mac Zelman MBA
Housing Demand
Will the high level of buyer demand last? For over a year, low mortgage rates have
powered buyer demand. While rates are projected to rise, they’re still much lower than
the historical norm, which creates opportunity for homebuyers. That’s why demand is
expected to remain high throughout 2021.
Taking into consideration the projections on housing supply and demand, real estate
analysts forecast home prices will continue to appreciate.
Bottom Line
There’s still a very limited number of homes for sale compared to the demand from
purchasers looking to buy them. As a result, home values will continue to appreciate,
making this fall a fantastic time to sell your current house.
9
Leveraging Your Equity To
Make a Move
According to the latest data from CoreLogic, the average homeowner
gained $33,400 in equity over the past year, and that number continues
to grow as home values appreciate.
Homeowner Equity Gains over the Past Year
CoreLogic
10Potential Home Price Growth over the Next Five Years
Based on projections from the Home Price Expectation Survey
$443,629
$429,333
$399,782
$414,574 $93,629
$380,310
$350,000 Potential growth in
household wealth over the
next five years based solely
on increased home equity
if you purchased a $350K
home in January 2021
2021 2022 2023 2024 2025 2026
Home Price Expectation Survey 2021 2Q
When you sell, the equity you build up over time can be used to help you meet your
goals. If you’re looking to move, you can use the equity from your current home to
make a larger down payment on your next one, so you’ll need to finance less of the
purchase price of that house.
Alternatively, you can use your equity to reach other big goals in your life, such as
starting your own business or funding an education.
The graph above is a great example of how home price appreciation converts into
equity when you own a home. If you purchased a $350,000 home in January of this
year, based on projected home price appreciation, you could potentially gain $93,629
in equity over the next five years – just by being a homeowner.
So, if you’re thinking of moving, remember that as a homeowner, you may have more
equity in your house than you realize.
This equity can also help homeowners who entered the forbearance program. Those
homeowners who have yet to work out a plan can leverage their equity and sell their
homes in order to avoid the foreclosure process.
Bottom Line
No matter your situation, let’s connect to find out if your current home equity can help
you make your next move sooner than you may have thought possible.
11Existing homeowners today are sitting on
record amounts of equity. As homeowners
gain equity in their homes, the temptation
grows to list their current home for sale and
use the equity to purchase a larger or more
attractive home.
- Mark Fleming, Chief Economist, First American
12Remote Work Is Changing
Our Home Needs
If you're still on the fence of whether or not to sell your house, think about if
your current home still meets your needs. For many homeowners, working
remotely impacts which features are most important in a home.
Before the pandemic, only 21% of
individuals worked from home.
However, a survey of hiring managers
conducted by Statista and Upwork Working from home isn’t a passing fad – for
projects 37.5% of U.S. workers will many professionals, it's here to stay.
work remotely in some capacity
over the next five years.
Percentage of Workers
Working from home gives Anticipated To Work Remotely
you more flexibility and over the Next Five Years
more options. Based on a survey of hiring managers
If you’re part of that 37.5%, working
Fully Remote
from home may provide you with 22.9%
opportunities you didn’t realize you
had. Since you don’t need to be tied to
a specific area for your job, it gives you Not
Remote 14.6% Partially
more flexibility when it comes to where 62.5%
Remote
you can live.
Statista/Upwork
13If you’re one of the nearly 23% of workers who will
remain 100% remote:
You have the option to move to a lower cost-of-living area or to the location of your
dreams. If you search for a home in a more affordable area, you’ll be able to get more
house for your money, freeing up more options for your dedicated office space and
additional breathing room.
You could also move to a location where you’ve always wanted to live – somewhere
near the beach, the mountains, or simply a market that features better weather and
community amenities. Without your job tying you to a specific location, you’re bound to
find your ideal spot.
If you’re one of the almost 15% of individuals who will have a
partially remote or hybrid schedule:
Relocating within your local area to a home that’s further away from your office could
be a great choice. Since you won’t be going into work every day, a slightly longer
commute from a more suburban or rural neighborhood could be a worthy trade-off for a
home with more features, space, or comforts. After all, if you’ll still be at home part-
time, why not find a place that better suits your needs?
According to the latest Top Ten Issues Affecting Real Estate from The Counselors
of Real Estate (CRE), many homebuyers are already taking advantage of their
newfound flexibility:
“. . . after years of apparent but variant trends towards urbanization,
the pandemic universally caused a movement away from urban cores,
particularly for those with higher incomes who could afford to move and
for lower-income individuals seeking lower costs of living.”
Bottom Line
If you’ve found what you’re looking for in a home is changing due to remote work,
it may be time to make a move. Let’s start prioritizing your home needs today.
14If I Sell Now, Where Will I Go?
Now is clearly a great time to sell, but when you do, where will you go? Let’s
compare the benefits of buying a newly built home versus an existing one. That
way, you can consider what most closely aligns with your homeownership goals.
Pros for Purchasing a Newly Built Home
Create your perfect home.
If you build a home from the ground up, you’ll have the option to
select the custom features you want including appliances,
finishes, landscaping, layout, and more.
Cash in on energy efficiency.
When building a home, you can choose energy-efficient options
to help lower your energy costs, protect the environment, and
reduce your carbon footprint.
Minimize the need for repairs.
Many builders offer a warranty, so you’ll have peace of mind on
unlikely repairs. Plus, you won’t have as many little projects to
tackle, like leaky faucets or shutters to paint.
Know you have brand new everything.
Another perk is that nothing in the house is used, it’s all brand
new and uniquely yours from day one.
15Pros for Buying an Existing Home
Explore a wider variety of home styles and floorplans.
With decades of homes to choose from, you’ll have a
broader range of floorplans and designs.
Join an established neighborhood.
Existing homes give you the option to get to know the
neighborhood, community, or traffic flow and patterns
before you commit.
Enjoy mature trees and landscaping.
Established neighborhoods also have more mature
landscaping and trees, which can give you more privacy
and curb appeal.
Appreciate that lived-in charm.
The character of older homes is hard to reproduce. If you
value old-school craftsmanship or design elements,
you may prefer an existing home.
Bottom Line
If you have questions about the options in your area, let's meet to explore what's
available and what's right for you.
1617
Save Time and Effort
by Selling with an Agent
Selling a house is a time-consuming process – especially if you decide to do it on
your own, known as a For Sale By Owner (FSBO). From conducting market
research to reviewing legal documents, handling negotiations, and more, it’s an
involved and highly-detailed process. Here are a few things you should consider
before putting that “For Sale” sign up in your yard.
1. Making a Good First Impression 2. Pricing It Right
While it may sound simple, there are a lot of Real estate professionals are experienced
proven best practices to think about when when it comes to looking at recent
prepping a house for sale. comparable homes that have sold in your
area and understanding what price is right
Do you need to take down for your neighborhood. We use that data to
your personal art?
price your house appropriately, maximizing
your return.
What’s the right amount of
landscaping to boost your In a FSBO, you’re operating without this
curb appeal? expertise. Even with your own research, you
may not find the most up-to-date information
What wall colors are most and could risk setting a price that’s
appealing to buyers? inaccurate or unrealistic. If you price your
house too high, you could turn buyers away
If you do this work on your own, you may before they’re even in the front door or run
invest capital and many hours into the wrong into problems when it comes time for
things. Your time is money – don’t waste the appraisal.
it. An agent can help steer you in the right
direction based on current market conditions
to save you time and effort. Since we’re in a
hot sellers’ market, you don’t want to delay
listing your house by focusing on things that
won’t change your bottom line.
183. Maximizing Your Buyer Pool
Simply put, real estate professionals can get your house in front of more buyers via
their social media followers, agency resources, and proven sales strategies. The more
buyers that view a home, the more likely a bidding war becomes. Using an agent to
boost your exposure may help boost your sale price too.
4. Navigating Negotiations
When it comes to selling your house as a FSBO, you’ll have to handle all the
negotiations. Here are just a few of the people you’ll work with:
The buyer, who wants the best deal possible
The buyer’s agent, who will use their
expertise to advocate for the buyer
The inspection company, which works for the
buyer and will almost always find concerns with
the house
The appraiser, who assesses the property’s
value to protect the lender
As part of our training, agents are taught how to negotiate every aspect of the real
estate transaction and how to mediate potential snags that may pop up. When
appraisals come in low and in countless other situations, we know what levers to pull,
how to address the buyer and seller emotions that come with it, and when to ask for
second opinions. Navigating all of this on your own takes time – a lot of it.
4. Juggling Legal Documentation
Speaking of time, consider how much free time you have to review the fine print.
Just in terms of documentation, more disclosures and regulations are now mandatory.
That means the stack of legal documents you need to handle as the seller is growing.
It can be hard to know and truly understand all the terms and requirements. Instead of
going at it alone, use an agent as your shield and advisor to help you avoid potential
legal missteps.
Bottom Line
Selling your house on your own is time consuming and requires an immense amount
of effort and expertise. Before you decide to sell your house yourself, let's discuss your
options to make sure you get the most out of the sale.
19Why Pricing Your House Right Matters
There’s no denying we’re in a sellers’ market. According to the Realtors
Confidence Index Survey from the National Association of Realtors (NAR),
50% of today’s offers are over the asking price.
While it may be tempting to price your house By pricing your house based on its current
on the high side to capitalize on this trend, condition and similar homes that have recently
doing so could limit your house’s potential. sold in your area, your agent can help you set
a price that’s realistic and obtainable – and
A high price tag doesn’t mean you’re going to
that’s good news for you and for buyers.
cash in big on the sale. While you may be
trying to maximize your return, the tradeoff When you price your house right, you increase
may be steep. A high list price is more likely to your home’s visibility, which drives more
deter buyers, sit on the market longer, or buyers to your front door. The more buyers
require a price drop that can raise questions that tour your home, the more likely you’ll have
among prospective buyers. a multi-offer scenario to create a bidding war.
When multiple buyers compete for your house,
Instead, focus on setting a price that’s
that sets you up for a bigger win.
fair. Real estate professionals know the value
of your home.
Bottom Line
When it comes to pricing your house, working with a local real estate professional is
essential. Let’s meet to discuss how you can optimize your exposure, your timeline, and
the return on your investment, too.
2021
22
“A home, now more than ever,
has become a top priority for
American households.”
- Odeta Kushi, Deputy Chief Economist, First American
23Let's Chat.
I'm sure you have questions and thoughts about the
real estate process.
I'd love to talk with you about what you've read here and help you on
the path to selling your house. My contact information is below, and I
look forward to working with you.
Collins Community Credit Union
Altoona, Ankeny, Cedar Falls, Cedar Rapids, Clive, Davenport, Dubuque, Marion,
North Liberty, West Des Moines
www.collinscu.org/mortgage
800-475-1150
Equal Housing Opportunity | NMLS# 562330
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